Steamboat 700 by the numbers
Total size: 508 acres
Open space and parks: 147 acres
Development area: 361 acres
Start of infrastructure construction: 2010
Start of homebuilding: 2011
Build-out: 20 years
Housing units: 2,044*
Commercial uses: 340,000 square feet*
Community housing units: 511**
Real estate transfer fee: 1 percent***
* Under a large-format retail alternative land-use plan, the number of housing units would be reduced to 1,818 and one of three mixed-use "village centers" would be replaced with a 348,000-square-foot retail center with space for two large-format retailers and a grocery store.
** Number includes a mix of for-sale and rental housing options for households earning between 70 percent and 160 percent of the area median income.
*** Initial sales and community housing units excluded. The transfer fee would be dedicated to community enhancements and housing affordability, and a specified amount would be earmarked to provide a permanent funding source for the Yampa Valley Housing Authority.
Source: Steamboat 700
Steamboat Springs Risk aversion was on everyone's mind Tuesday night as City Council and Steamboat 700 developers resumed their slow dance toward annexation.
At the end of the evening, council members left little doubt about who could be left holding the bag. If a fiscal stew of property taxes, real estate transfer fees, interest rates and housing absorption rates fails to produce enough revenue to fund $70 million to $80 million of community capital improvements in the project west of Steamboat, the developers will be on the hook.
"We choose not to put the city of Steamboat Springs in a position of assuming risk," Council President Loui Antonucci said. "We can talk about that, but I don't think our position is going to change."
He made the remarks as Steamboat 700 representatives debuted a financial plan they say would generate sufficient revenue to raise $48 million for public improvements in the next 35 years. Financial consultant Jean Townsend told council that $48 million is the share her clients think they should contribute to $70.8 million in infrastructure needs, ranging from sidewalks to fire trucks, in neighborhoods where they hope to build as many as 2,000 homes. The site is north of U.S. Highway 40 and just west of the existing city limits.
The balance of the money could come from state and federal highway funds, other developments being considered for annexation - such as 360 Village - and the city.
Elements of Steamboat 700's financing proposal for capital costs are so new, city staff has not had time to analyze them and report to council. Accordingly, council members were hesitant to discuss their merits.
Townsend said her clients are willing to provide more than $8 million in cash for priority projects soon after Steamboat 700 wins an annexation agreement. That amount includes $5.5 million for U.S. 40 improvements they say would include rebuilding the intersection at Elk River Road. The money would become available, Townsend said, as soon as the initial final plat for the development is filed.
Also within 60 days of annexation, they would contribute $100,000 for the city's water rights enhancement fund. And when the city and Steamboat Springs Rural Fire Protection District are ready to finance a new fire station in west Steamboat, Steamboat 700 would come through with almost $2.7 million for that project.
But the developers also are asking for some concessions.
They want to be excused from contributing $3 million to $14.5 million to help solve the 13th Street bottleneck, a problem they say pre-dated their development proposal. Nor do they want to be compelled to put up $8.9 million for a new public safety building, a need they say was formally documented by a city study in 2001. They also want to be credited for between $20 million and $28.8 million in use and excise tax revenues they say construction of the new neighborhood will contribute to city coffers.
Council members expressed concern with long-term figures.
Steamboat 700 proposes to levy five mills of property tax within its metro district and collect a 0.2 percent real estate transfer fee to pay for its remaining $48.7 million share, or 69 percent, of capital improvements. Townsend said it would take 35 years for those revenues streams to cover the big number.
Councilman Jon Quinn said there is no way for city government to know with certainty whether all of the financial variables that affect those revenue generators will actually cover the figure.
"The proposal has a great many assumptions in it - absorption rates, interest rates, inflation - if we accept a financial model, the city accepts the risks. What happens if the revenues run short?" Quinn asked.
Townsend hesitated to say Steamboat 700 would cover any and all shortfalls and Councilwoman Cari Hermacinski countered.
"This is a collaborative partnership. But how can the city turn around and accept that risk?" Hermacinski asked. "The fact remains that you guys are the entrepreneurs. If there's a shortfall, it's going to have to be absorbed by Steamboat 700."
Public speaks out
Previous public hearings concerning the proposed annexation of Steamboat 700 have been lightly attended. However, 45 people, two former City Council presidents among them, came prepared to speak Tuesday night.
- Bill Jameson argued that residents of 2,000 new homes someday could swamp existing city recreational facilities such as swimming pools and Howelsen Ice Arena.
"Require a rec center," Jameson urged. "If you don't, I want to know what you expect the people to do. You've got a real problem."
- Former City Council President Ken Brenner: "I can't find a wastewater treatment facility (in the list of capital improvements). Rifle has experienced growth from energy and had to expand its sewage plant. The cost was $23 million. That's an enormous cost I don't see addressed in here."
- Bill Moser asked, "Have you ever considered putting this before the residents in the form of a referendum? Because this is a major change of lifestyle of everyone in own and affects everyone - where you work, where you play." Antonucci replied that City Council decided not to take an annexation question to voters because the West of Steamboat Springs Area Plan was the subject of many public hearings.
- Steve Lewis asked, "If we start a petition drive to put it on the ballot, will the developer then have a chance to make changes to the plan?" City Attorney Tony Lettunich said the answer to that is "no." The annexation would be ratified by an ordinance. Any ballot question would be worded to simply uphold or overturn the ordinance. Hermacinski reminded Lewis that the developers have voluntarily agreed that they would live with the state's petition threshold of signatures equivalent to 10 percent of the electorate rather than the city's 20 percent requirement.